Two Alaska nonprofits who were gifted an investment in the controversial Pebble Mine project this spring have opted to sell the stocks.
The Bristol Bay Native Corporation Education Foundation and the Alaska Community Foundation each liquidated their stake in the Pebble Partnership last week after they were each gifted 9 million shares of Northern Dynasty Minerals' stock in April. The shares represented 19.1 percent of the Pebble Partnership formerly owned by Rio Tinto, the British-Australian mining company who looked to divest from Pebble following London-based Anglo-American's decision to withdraw from the project last September.
The Pebble project has faced harsh scrutiny over potential impacts on the environment. If developed as currently planned, the project would be one of the largest open pit mines in the world. Northern Dynasty estimates that the proposed mining area could contain as much as 81 billion pounds of copper, 5.6 billion pounds of molybdenum and 107 million ounces of gold. Estimates have put the value of the resources at up to $300 billion.
The gifting of the shares came as something of a surprise, since Bristol Bay Native Corp. has been deeply critical of the project. While BBNC is a major funder of the Education Foundation -- the sole purpose of which to provide scholarships to shareholders -- the foundation maintains a nonprofit legal status separate from the corporation.
Both nonprofits independently sold the stocks last week for $6.48 million each. Initially valued at about $16 million, Northern Dynasty's stocks have dropped in recent months. The company closed at 79 cents per share Tuesday. When the stocks were gifted, their price remained steady at 88 cents a share, but far below their value a year before at $3.
Each nonprofit group said hanging on to the shares was not in line with their core missions.
"Those particular shares represented a concentrated position in a single security, so we liquidated them so proceeds could be reinvested in a way consistent with our investment policy," said Greta Goto, executive director of the BBNC Education Foundation.
Candace Winkler, president and CEO of the Alaska Community Foundation, said organization receives "complex gifts" all the time, from swaths of land to boats and closely held stocks, she said, and that the foundation generally works quickly to transition those assets into their investment portfolio, which contains about $80 million spread into 315 different funds.
Goto said the funds would go toward educational scholarships for shareholders in the Bristol Bay region as well as toward developing a cultural heritage program. Winkler said ACF would also use the funding to provide more educational opportunities to Alaskans, but on a broader statewide basis.
Mike Heatwole, spokesman for the Pebble Partnership, said it was a good thing the groups were able to generate value from the gift stock. He said that indicates that there "remains interest in the potential from the project in the investment community."
He said the partnership is still looking for a partner to help advance the project into permitting.
"We remain optimistic about this and continue to have positive discussions with potential partners," Heatwole said.
Correction: An earlier version of this story incorrectly listed Bristol Bay Native Corp. as a parent company to the Bristol Bay Native Corporation Education Foundation. Despite being a major funder, the corporation maintains a separate legal status from the nonprofit foundation.